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The credit crisis has already led to the withdrawal of a record number of deals. Last week, market turmoil forced Anglo-Australian mining group BHP Billiton to pull its acquisition of Rio Tinto, which it was planning to fund with £36billion of loans.

The collapse in deals is hitting banks revenues hard because they earn a large portion of their fees when a deal completes.

Deal activity is down by more than a third this year as banks have stopped lending to firms seeking deals.